Economic disparity of medical insurance more galling every year

Published 10:00 pm, Saturday, July 19, 2003

Earlier this year I parted ways with my gallbladder. This split presented me with a first-rate lesson in how the medical business is changing.

The procedure itself was remarkable: laparoscopic surgery. The doctor made tiny incisions to remove the organ in a clinic. The entire operation was quick and painless -- and was completed in a few hours.

The financial aspect was fascinating as well. The surgeon's assistant explained that the office would help me file my insurance claims, but she did not want to deal directly with any insurance companies. I would have to bear the financial responsibility -- and get reimbursed.

No big deal, I thought. Then came a bill for several thousand dollars. A few weeks later I received a check from the insurance company -- for quite a bit less. The doctor had one idea about what the surgery should cost and the insurance company had a different amount in mind. It was up to me, of course, to make up the difference.

Someone in the doctor's office explained that the billing process was designed so an insurance company would not determine the fees.

I was lucky. I had good coverage (including a second policy that covered what the first policy did not). And I sort of liked the notion that my doctor charged every patient equally for the same service.

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But it's not always like that. Last week a congressional committee began investigating how some hospitals charge uninsured patients far more than they invoice insurance companies for the same service.

Those who can least afford it pay a "retail" price. Those whose insurance pays all or part of those costs get a significant discount.The economic disparity of insurance -- who has it and who doesn't -- is becoming more of a problem every year.

A recent study says barely half of the U.S. work force is covered by employer-sponsored plans -- and that number is dwindling fast.

A study by Harvard economics professor James Medofffound that only about one-quarter of workers in the bottom fifth of the earnings scale had health care insurance as part of their pay. On the other hand, workers like me, who are in the top fifth of what workers make, nearly always have health care coverage from employers.

The study said one reason for this "downward spiral of employer-sponsored insurance" is that fewer of us make things. "Manufacturing jobs have historically offered workers very extensive health coverage," says Medhoff's report, "The Impacts of Labor Market Trends on Health Care Coverage."

Nowadays there are more independent contractors, part-time workers and folks working in service jobs who fall into Medhoff's "bottom fifth." Some of these workers are uninsured because they pick living expenses -- food, rent, clothes -- over costly health insurance. They are betting they will stay healthy. Hoping might be a better word.

Hospitals say they already are spending $21.5 billion a year for uncompensated, uninsured patients. That means a prudent health care provider will ask for more money upfront from uninsured patients -- or turn over the bills to aggressive collectors.

The mathematics isn't much better on the employers' side of the ledger. Health insurance costs more every year and most businesses are not increasing revenues during a slow economy, so they ask workers to pay more for their insurance.

Look at most of the labor strikes (or would-be strikes) across the country and one common thread is tied to this one question: Who's going to pay what for health care?

"The simple fact is that employers pursuing their rational self-interest will not provide health care benefits if not required," concludes Medhoff's report. But the report also says that's not likely to happen in the current climate.

Then the climate should change.

Between now and the next presidential election we're going to hear this question asked a lot. The sheer number of uninsured Americans, some 41 million, makes it so every candidate wants to ask and then propose an answer. A lot of voters might cast ballots based on this one issue.

President Bush has put this subject on the agenda for older Americans with his proposals for Medicare reform. But that's only a start because so many younger Americans are facing a health care crisis, too.

The good thing about all of this becoming an election issue is that it will help this country have a conversation that we ought to have. We need to talk about what might work.

Then I think about my late gallbladder and know the news is not all bad. A few years ago that procedure would have cost a lot more because my surgery occurred in a clinic and I didn't have to stay for a night or more in a hospital room. We have made some progress.

Perhaps there's something there that will lead us to common ground so we can walk down a new path, one that works for patients, employers, doctors, hospitals, taxpayers and even politicians.